Trade Literature Research Articles

Role of 'Right' Friends in GVC Participation: Evidence of the Importance of Network Connections From India’s Automotive Sector

Several studies in the area of networking have attested to the fact that network connections are an important source of competitive advantage for firms. In the networks and trade literature, the gains from networking have been broadly associated with lowering of information costs (thus improving information channels within and across borders) as well as diffusion of preferences. In this paper we establish how firms are affected by their local and national networks in the context of Global Value Chains in terms of impact the odds of the participation in the sectoral GVCs. We show through a theoretical model that network characteristics can prove vital in mitigating the handicaps due to size of firm by enhancing productivity through the diffusion of general innovation (sans R&D). This question is especially pertinent for small and medium firms that face natural disadvantages owing to their size. We then also provide proof for this proposition (that the drawbacks due to firm characteristics like size can be mitigated by forming the “right” alliances – both locally and nationally) empirically from Indian Automotive Sector network.

Occupational Health Could be the New Normal Challenge in the Trade and Health Cycle: Keywords Analysis Between 1990 and 2020.

This brief report aims to establish the keyword content of studies on occupational health and safety—the key framework of the world of work in the trade and health domain. Data were collected from the SCOPUS database, focusing on articles on occupational health and safety and related keywords, with an emphasis on abstracts and titles. Data were analyzed and summarized based on keywords included from the MeSH database. There were 24,499 manuscripts in the domain and 1,346 (5.40%) occupational health-related keywords, including those that overlapped. The most frequently referenced occupational health–related keyword was “occupational health” (452 articles), followed by “occupational safety” (141 articles). There were fewer keywords on occupational health in the trade and health literature. As the world of work has been prioritized because of the recent new normal of work life since the COVID-19 pandemic, examining the focus of occupational health priorities within the global perspective is crucial.

Is publicly-reported firm-level trade data reliable? Evidence from the UK.

In this paper we compare firms' self-reported overseas sales, as reported in a commonly used UK financial reporting dataset, with their actual exports, as reported by Her Majesty's Revenue and Customs (HMRC). Finding that these flows are in several dimensions quite different, we then explore the implications of these differences more formally. Since several studies within the international trade literature report findings based on the self-reported export values in financial datasets, we discuss these findings in light of the departure of financial dataset-based exports from "true" (HMRC) export values.

Sell-side analyst heterogeneity and insider trading

This study explores insider trading patterns under different earnings surprises. After controlling for stock market liquidity and earnings announcements returns, we show that insiders sell more aggressively depending on the heterogeneity of analysts whose EPS forecasts are met or beaten to camouflage their trades. Specifically, insiders sell more shares of their company sooner after the publication of earnings when top analysts' forecasts are met or beaten. Consistent with the informed trading literature, insiders strategically select these moments because the stock price impact is low and the legal scrutiny of their trades is minimal. To support this result, we employ an exogenous drop in firms' analyst coverage due to the closure or merger of brokerage houses. Furthermore, in line with the camouflage incentives, by selling after top analysts' forecasts are met or beaten, stock prices adjust slowly to insider trades. Finally, we show that the incentives of insiders to hide their trades are concentrated in opportunistic insiders and members of the top management team, who are more likely to bear the costs of selling shares after positive news.

Diffusion of blockchain in logistics and transportation industry: an analysis through the synthesis of academic and trade literature

PurposeBlockchain technology has fascinated researchers and industry professionals. Since its birth, the attention for blockchain has been exponentially increasing, however, most of the industries are still skeptical in adoption for value creation. The purpose of this study is to analyze the actual level of implementation and diffusion of blockchain technology within the logistics and transportation industry by comparing and using the collective intelligence of academic literature and industry practices of implementation of blockchain in this domain.Design/methodology/approachThis study uses the methodology of systematic literature review along with inductive reasoning. The systematic literature review of academic and industry frontiers together has brought a bigger and real picture into consideration.FindingsThe results highlight that, within the transportation sector, currently there is a very low diffusion of blockchain, although applications show immense promises for the future. The various application where blockchain technology can make a significant impact are also identified.Research limitations/implicationsDue to the early stage of experimentation with blockchain technology, high-quality data which is relevant to the optimized usage of this technology in the logistics and transportation industry is not available.Practical implicationsThe study will help the practitioners in identifying additional avenues in which they could implement blockchain for the effectiveness, efficiency and growth of the logistics and transportation industry.Originality/valueThe analysis of mixed sources of information for undertaking systematic literature review by assessing academic and trade publications is a novelty of this study.

Trade shocks and the shifting landscape of U.S. manufacturing

Using data over more than a century, we show that shifts in the location of manufacturing industries are a domestic reflection of what the international trade literature refers to as the product cycle in a cross-country context, with industries spawning in high-wage areas with larger pools of educated workers and moving to lower-wage areas with less education as they age or become “standardized.” We exploit the China shock industries as a set of industries that were in the late-stage product cycle by 1990 and show how the activity in those industries shifted from high-innovation areas to low-education areas over the 20th century. The analysis also suggests that the resilience of local labor markets to manufacturing shocks depends on local industries’ phase in the product cycle, on local education levels, and on local manufacturing wages. The risk of unemployment and detachment from the labor force rises most when a shock hits in areas where an industry already has begun phasing out, wages are high, or education levels are low. The results are consistent with the belief that there are long-term, secular trends in U.S. industrial structure driving the movement of industries, which shocks may mitigate or accelerate.

Trade models and macroeconomics

This paper discusses some macro links that are missing from trade models. A multicountry macroeconometric model is used to analyze the effects on the United States of increased import competition from China, an experiment that is common in the recent trade literature. In the macro story a fall in Chinese export prices is stimulative. Domestic prices fall, which increases real wage rates and real wealth, which increases household expenditures. Trade models do not have these channels, and they likely overestimate the negative effects or underestimate the positive effects on total output and employment from increased Chinese import competition. They lack some important aggregate demand channels.

Anti-Staphylococcal and cytotoxic activities of the short anti-microbial peptide PVP.

Over the past years, short anti-microbial peptides have drawn growing attention in the research and trade literature because they are usually capable of killing a broad spectrum of pathogens by employing unique mechanisms of action. This study aimed to evaluate the anti-bacterial effects of a previously designed peptide named PVP towards the clinical strains of methicillin-resistant Staphylococcus aureus (MRSA) in vitro. Secondary structure, cytotoxicity, and membrane-permeabilizing effects of the peptide were also assessed. PVP had a tendency to adopt alpha-helical conformation based upon structural predictions and circular dichroism spectroscopy (in 50% trifluoroethanol). The peptide showed MIC values ranging from 1 to 16µg/mL against 10 strains of MRSA. In contrast to ciprofloxacin and gentamicin, PVP at sub-lethal concentration (1µg/mL) did not provoke the development of peptide resistance after 14 serial passages. Remarkably, 1h of exposure to 4 × MBC of PVP (8µg/mL) was sufficient for total bacterial clearance, whereas 4 × MBC of vancomycin (8µg/mL) failed to totally eradicate bacterial cells, even after 8h. PVP showed negligible cytotoxicity against human dermal fibroblasts at concentrations required to kill the MRSA strains. The results of flow cytometric analysis and fluorescence microscopy revealed that PVP caused bacterial membrane permeabilization, eventually culminating in cell death. Owing to the potent anti-bacterial activity, fast bactericidal kinetics, and negligible cytotoxicity, PVP has the potential to be used as a candidate antibiotic for the topical treatment of MRSA infections.

Performance outcome assessment of the integrated project delivery (IPD) method for commercial construction projects in USA

This article presents the results of a quantitative study evaluating relationships between various project outcome metrics and the use of Integrated Project Delivery (IPD). Conflicting results within the literature about these relationships, coupled with significant industry interest, motivated this study. Data from 93 building construction projects were analyzed in a multivariate context controlling for the contribution of covariates unrelated to delivery methods. At the 95% confidence level (CL), significant performance outcomes were not found for IPD projects. Though, at the 90% CL, lower levels of cost and schedule growth were found to be significant for IPD projects when compared to projects completed using other common delivery methods. Also, IPD healthcare projects were found to have significantly fewer Requests for Information (RFI) than non-IPD healthcare projects. Lastly, urban projects showed significantly higher levels of cost and schedule growth, along with increased RFI and punchlist frequency counts, than either suburban or rural projects. Recommendations include exercising caution in the use of IPD as a means to check cost and schedule growth while improving design quality. Project owners should also moderate expectations that IPD is a solution to many of the industry’s problems as postulated by prevalent qualitative and trade literatures.

A psychological model of transparent communication effectiveness

PurposeWhen it comes to tactics that organizational communicators can undertake to elicit positive gains with stakeholders, transparent communication ranks high on lists proposed by both the scholarly and trade literatures. However, little is known about why such communication tactics are effective on a psychological level. Thus, this study aims to propose and test a psychological model of transparent communication effectiveness in the context of proactive, socially responsible brand communication. The model was based on three propositions: (1) transparent communication offers audiences an important opportunity to learn more about organizational functioning, (2) learning elicits an organizationally relevant positive affective state and (3) positive affect facilitates a robust relationship between perceived learning outcomes and positive evaluation of the organization.Design/methodology/approachThis study used an experiment to test the hypothesized model.FindingsSupport was found for the proposed model. Specifically, the data indicated that the use of transparent massaging elicited higher levels of perceived learning. Perceived learning was associated with positive brand-relevant affect. Finally, positive brand relevant-affect predicted positive summary brand evaluation.Originality/valueTaken as a whole, the current findings inform theorizing on transparent organizational and brand communication by describing the foundational roles played by perceived knowledge gain and positive affect in encouraging positive message-related outcomes.

Is the productivity premium of internationalized firms technology-driven?

We ask whether the productivity advantage of internationalized firms documented by the international trade literature can be interpreted most accurately in terms of proximity to the “technological frontier”. We answer in the affirmative using a methodology (based on mixture models) of unbundling technology and total factor productivity (TFP) by estimating “technology-specific” production function parameters. Exploiting detailed data provided by the EFIGE database (a sample of firms distributed across Austria, France, Germany, Hungary, Italy, Spain, and the UK), we find technology gaps (with respect to the frontier) more than three times larger than the TFP gaps on average. We also find sizable technology advantages for firms undertaking foreign direct investment and/or exporting to other European Union countries or to China, for importers of materials, and for firms with competitors in China and the USA. Medium and large firms feature a higher technology premium, which is even higher for firms operating in country-sectors that are more exposed to import competition from China. Younger firms use better technologies but less effectively.

Technical analysis using Heiken Ashi Stochastic: To catch a trend, use a HASTOC

AbstractThe study develops a new technical analysis indicator, HASTOC, which reflects in a single number the likelihood of trend generation and momentum in the market. The indicator is developed using the basic characteristics of the Japanese Heiken Ashi (HA) candles. We backtest strategies using HA and HASTOC for three currencies, one index and one stock for three major time frames in each market and find that the strategies give consistent positive returns for select time frames and markets. The contribution of this study extends to the practical trading scenario and literature on technical analysis.

A Behavioral Explanation of Firm’s International Trade Behavior in Emerging Markets

In response to the recent call for firm-level analysis in international trade, this study examines the effects of performance-aspiration level, slack resource, and firm inertia on the risk-taking behavior (export) of firms from a behavioral perspective. Using a Chinese pharmaceutical industry dataset consisting of 1904 firm-year observations for the 1998 to 2000 period, this study finds that exports would increase as the focal firm’s performance level falls below or rises above its aspiration levels, and also as the focal firm’s accumulated slack resources increase. However, as an indicator of inertia, firm size can moderate the relationship between performance-aspiration level, slack resources, and export behavior. Larger firms are more risk-averse and less likely to export, or export less than smaller firms, even when their performance-aspiration level is very high, or very low, or the focal firm has accumulated abundant slack resources. This study contributes to the international trade literature by analyzing firm-level factors in response to a call for management theory perspectives on firms’ trade in emerging markets.

Financial constraints and the export decision of Pakistani firms

AbstractThe payment of sunk costs associated with the entry to foreign export markets highlights the significance of financial dimension in the firm decision. The sunk costs become a challenge for the financially constrained firms. In this paper, we study the relationship between financial constraints and the export entry decision of the firms in a lower‐middle income country context. We use new measures of financial constraints in finance literature alongside widely used measures of financial health in trade literature to scrutinise the relationship for Pakistani listed manufacturing firms. We find that being less financially constrained is a vital determinant of the Pakistani firms' export participation decision irrespective the high firm leverage before entry. The undeveloped financial system and heavy reliance on bank loans for external finance in Pakistan may be the plausible explanations for our findings. Our results suggest that measures of financial constraints are more appropriate than the widely used measures of financial health in studying the determinants of the export participation decision. In addition, we find evidence that future exporters improve their financial conditions prior to entering the export markets. However, we do not find any evidence that exporting improves financial conditions of the firms after entry.

Two-way traders: searching for complementarities between exports and imports in a developing country

ABSTRACT The international trade literature has extensively analysed the role of exports and imports as productivity shifters. However, most studies analyse one of these two activities in isolation, and empirical evidence on this matter to a large extent refers to developed countries. We analyse the relevance of the interaction between exports and imports to determine productivity by applying a test of complementarity between these activities for a developing country. Using firm-level data from Ecuador, we find evidence suggesting that there is complementarity between exports and imports in determining productivity.

The global internet market(s): a reconstruction of the views of the industry

PurposeThis paper aims to provide a synthesis of the evolution of the global internet markets through an assessment of their economic strength. It is an attempt to describe the various segments of the internet value chain and the evolution of the markets. It aims at briefly summing up the very dynamics of the sector, of the various subsectors while looking at the business models and the market capitalization.Design/methodology/approachThe paper is a descriptive paper, presenting market trends, based on desk research and trade press. It is not meant to provide any theoretical contribution but attempting to reconstruct the views from the industry as documented by trade literature. Hence, the paper relies mostly on industry and consultancy data. The paper builds on a database collected by the author over the past 30 years and the selection of the relevant data to document and identify the trends and offer a synthesis of the views of the industry.FindingsThe paper shows how over the past 30 years the internet has changed dramatically from both a quantitative (reaching more and more users worldwide and witnessing a dramatic growth of all markets) and qualitative (offering an array of innovative products and services enabled by the deployment of new networks) and the availability of new devices. The paper reveals how each technological wave ushered in a series of innovation and new services, boosted the foundation and the growth of pioneering companies.Research limitations/implicationsTaking into account the lack of official data, the industry data used should be treated as just signals of potential trends, but sufficient to give an overview of the evolution of the global internet markets. Furthermore, detailed studies should complement this descriptive approach. The approach does have obvious methodological and theoretical limits, not providing a robust methodological framework just offering a reconstruction of the trends as documented by the trade publications. However, it concludes highlighting some of the tensions and contradictions.Practical implicationsThe paper closes with a summary of the main transformations and considers some future developments. The paper draws some lessons from some failures and from the strategies of firms.Social implicationsThe paper hints at the way users developed “unique” behaviors using social media, taking advantage of the new opportunities to exchange with others. The paper hints at some regulatory issues and challenges.Originality/valueThe paper briefly sums up the very dynamics of the global internet market(s). It attempts to characterize some of the main features of their evolution and of the main segments. If offers a comprehensive overview of available data.

What does “doing business” really measure? Evidence from trade times

The World Bank’s Doing Business project claims to provide “objective measures of business regulations in 190 economies”. In the trade literature, a key use of these data has been to show the impact of border delays on trade performance. We revisit previous results using a structural gravity model and panel data for 2005–2015. Although we confirm the original finding, we also show that trade times have a negative and statistically significant impact on services trade—even though services do not in reality experience border delays. The effect is due to an apparent mixing in the Doing Business data of aspects of a country’s institutional environment with information on trade times. Our results provide a caution for applied researchers, and policymakers using these data to track performance.

Do economic integration agreements affect trade predictability? A group effect analysis

AbstractRecent theoretical findings in the trade literature suggest that economic integration agreements (EIAs) not only increase the level of trade but also make it more stable and predictable. This paper proposes a Hausman–Taylor quantile regression approach to identify the causal effect of EIA membership on trade predictability. The proposed methodology accounts for group effects in the gravity equation and is computationally efficient. Our results corroborate the theoretical findings that EIAs make trade more stable and predictable and this conclusion is even stronger for deeper EIAs.

Foreign Outsourcing and Technology Transfer under Information Asymmetries

Although outsourcing vs. vertical integration is generally treated as a binary choice in international trade literature, firm-level data reveal that inputs can be imported both within and across firms' boundaries, even within narrowly defined industries from the same host country. This paper outlines a model of foreign sourcing which accommodates this practice (defined as mixed-sourcing) based on information asymmetries between a firm and suppliers on both (i) the firm's cost in transmitting knowledge across borders; and (ii) the supplier's productivity in using this know-how to customize input provision. Supply relationships establish that the firm gives an ownership share to its foreign supplier. The paper explores under what conditions the firm engages in multiple relations with suppliers of different types (high and low productive ones) based on differentiated ownership shares, thus compatible with the evidence of mixed-sourcing.

Comments on Assessment of the Trade Integration Pattern Between the Russian Federation and East/Southeast Asian Economies Using the Panel Gravity Framework

Comments on Assessment of the Trade Integration Pattern Between the Russian Federation and East/Southeast Asian Economies Using the Panel Gravity Framework